Question

Bunnell Corporation is a manufacturer that uses job-order costing. On January 1, the company's inventory balances were as follows: Raw materials Work in process Finished goods $ 63,000 $ 22,200 $ 52,500 The company applies overhead cost to jobs on the basis of direct labor-hours. For the current year, the company's predetermined overhead rate of $11.50 per direct labor-hour was based on a cost formula that estimated $460,000 of total manufacturing overhead for an estimated activity level of 40,000 direct labor-hours. The following transactions were recorded for the year: a. Raw materials were purchased on account, $618,000. b. Raw materials use in production, $569,400. All of of the raw materials were used as direct materials. c. The following costs were accrued for employee services: direct labor, $410,000; indirect labor, $150,000; selling and administrative salaries, $338,000. d. Incurred various selling and administrative expenses (e.g., advertising, sales travel costs, and finished goods warehousing), $382,000. e. Incurred various manufacturing overhead costs (e.g., depreciation, insurance, and utilities), $310,000. f. Manufacturing overhead cost was applied to production. The company actually worked 41,000 direct labor-hours on all jobs during the year. g. Jobs costing $1,372,600 to manufacture according to their job cost sheets were completed during the year. h. Jobs were sold on account to customers during the year for a total of $3,202,500. The jobs cost $1,382,600 to manufacture according to their job cost sheets.

Answer 1

10)	Cost of goods available for sale				1,425,100	answer
	(52500+1,372,600)
11)	Transaction	General Journal					Debit	Credit
	h.	cost of good sold					1,382,600
		Finished goods inventory						1,382,600
12)	Finished goods	Finished Goods
	Beg.bal	52,500
	g.	1,372,600	1,382,600	h.
	End bal	42,500